Submitted by John B., Apr 18, 2007 12:05

China economic and political systems are designed to do one thing: perpetuate the control of the Chinese Communist Party. Profits, pollution, respect for contracts all mean nothing except as they pertain to keeping the CCP in power. China has some 800 million peasant farmers who want a better life and some 60% or so of jobs are still in horribly inefficient state-owned enterprises. China's overriding concern is to maximize employment, not to maximize profits or efficiency. The government will manipulate the currency, give 0% loans to companies, or embark upon enormous infrastructure projects in order to keep people employed and happy, and ultimately, to keep the CCP in power. Expectations among the people are rising faster than China can create jobs so China is going to enter a period of profound instability in coming years. If your company depends on China in any way, buckle up!

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